The disclosure of personal interests by council decision-makers is legislated to ensure transparency in decision making in the local government sector. The twice-yearly disclosures aim to increase public confidence in the impartiality of decision-makers and ultimately the integrity of council decisions.
Our major review of personal interests returns under the 1989 Act showed a concerning level of non-compliance with the disclosure requirements. At least 51 per cent of the 650 councillors we reviewed did not fully comply with all legislative requirements regarding their returns submitted in the 2016–20 period.
We conducted a detailed review of 147 councillors which uncovered higher levels of non-compliance. This suggests that the true levels of non-compliance are even higher than 51%.
This low level of compliance risks confidence in the integrity of our grassroots democracy.
In addition, our review of personal interest summaries under the 2020 Act showed that there is still a lack of transparency in the sector with three councils failing to publish any summary and another 13 councils had not published a summary for the last 5 months.
As part of our major review, we surveyed councillors and council staff about the personal interests returns process and this helped us identify issues with the process.
Councillors told us that they did not adequately understand the purpose or importance of disclosing interests in an honest and transparent manner. In addition, councillors lacked sufficient knowledge to adequately complete returns and council staff lacked the confidence to guide them in doing so.
The 2020 Act is still relatively new and now is a good time to consider ways to improve compliance and transparency across the sector.
A dedicated training program and improved guidance could help bridge the knowledge gap.
LGV must consult with the sector and the Inspectorate and finalise its guidance material, ensuring it is in plain English and includes real-life examples. The material should be easily accessible on the LGV website and must be promoted through its communication channels.
LGV should also provide more guidance to councils to help them with the new requirements to publish a summary of personal interests returns.
We also recommend that training on personal interests returns should be compulsory for councillors, which should include training on induction and annual refresher courses. Councils should also introduce training to support their staff who must fill out interests returns but also for governance staff who are often asked for guidance from councillors about how to complete returns.
We also propose a number of smaller changes, such as setting up an email helpdesk to respond to queries about personal interests returns, as well as regular communication about the importance of personal interests returns. Compliance could also be improved using automated systems.
One of the biggest impediments to achieving full compliance of personal interests returns is the lack of appropriate enforcement measures. Currently the only means of enforcement available to us is the criminal justice system with its costs and lengthy delays. There is a lack of appropriate and scalable enforcement measures, which means only the most serious and persistent offenders are pursued. We propose that infringements and non-monetary sanctions be introduced into the legislation to allow for greater flexibility with enforcement.
We also consider that making the reporting of breaches mandatory and strengthening external scrutiny are key to increasing compliance.
There is still more work to be done by the Inspectorate, LGV and councils to increase compliance levels, and this report should be considered a first step on a journey to improve the outcome of the requirement.
We would like to thank the councillors and council staff who took the time to provide extensive feedback on the 1989 and 2020 schemes. This information gave us a valuable insight into the issues and problems councillors and council staff face.
We also commit to working with LGV and councils to improve the understanding of the importance of the requirement and supporting those who must comply with it.
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